In Tuesday’s next-day trading, broad gains from the Marcellus westward were unable to counter steep Northeast declines and the market fell 4 cents to $2.61.

Producing zones and market zones more closely aligned with the Henry Hub posted gains of a nickel to a dime, and of all the actively traded points followed by NGI only a dozen or so posted losses. A softer power sector prompted the eastern losses, as weather conditions were expected to moderate. Futures prices were able to work higher, but traders saw the move as uninspired and consistent with its recent rangebound pattern. At the close, August had added 5.9 cents to $2.882 and September had risen 6.0 cents to $2.890. August crude oil continued to flirt with the pivotal $50 support level and gained 21 cents to $50.36/bbl.

California prices gained ground, although loads were forecast to ease. The California Independent System Operator (CAISO) reported that Tuesday’s peak load was expected to reach 38,347 MW, down from Monday’s peak of 40,597 MW but greater than Wednesday’s forecast peak of 36,731 MW.

Gas at Malin gained 3 cents to $2.86, and deliveries to the PG&E Citygate gained 8 cents to $3.24. Gas at the SoCal Citygate was seen 4 cents higher at $3.18, and deliveries to SoCal Border were quoted 7 cents higher at $3.01. Parcels on El Paso S Mainline added 4 cents to $3.02.

Eastern points fell hard as on-peak power prices posted double-digit losses and near-term weather outlooks moderated. Intercontinental Exchange reported Wednesday on-peak deliveries to ISO New England’s Massachusetts Hub shed $14.45 to $33.86/MWh, and on-peak power at the PJM West terminal dropped $11.40 to $36.27/MWh.

Deliveries to Tetco M-3 changed hands 4 cents lower at $1.38, but packages bound for New York City on Transco Zone 6 shed 99 cents to $1.99.

Gas at the Algonquin Citygate was seen $1.46 lower at $2.45 and gas on Iroquois Waddington came in 9 cents lower at $3.02. Gas on Tennessee Zone 6 200 L plunged $1.26 to $2.43.

AccuWeather.com meteorologist Alex Sosnowski said, “Following more 90-degree F days with [heat index] temperatures topping 100 F, less extreme conditions are in the offing for the Washington, DC, and Baltimore areas starting on Wednesday. A cool front will push through the region Tuesday night and will be preceded by spotty thunderstorms. Storms into Tuesday evening could be locally robust.”

The spot August futures contract was limited to a six-cent trading range, and traders were unimpressed. “I still think the market is rangebound,” said a New York floor trader. “Maybe traders will test the $3 area again since Monday’s sell-off failed. It seems like some buying came in, but I think it had to do with the warm spike we had. This market needs a weather event.”

Analysts are not ready to pen the demise of the summer cooling season. “The third week of July traditionally represents the seasonal peak of the summer-time heat. And based on the very warm conditions unfolding this week in the eastern half of the nation, it appears that this season is in lock-step with this historical trend,” said Teri Viswanath, director of commodity strategy at BNP Paribas.

“While the warmest temperatures unfolding this week appear to be concentrated in the Southeast, the heat developing on the eastern seaboard is likewise notable, with daily highs current predicted in the upper 80s and lower 90s. Looking ahead to next week, the consensus weather forecasts predict a similar level of heat across the southern tier, keeping cooling demand elevated thru the balance of the month.

“Despite the foreseeable break in the July heatwave, there appears to be little staying power for writing off the summer at this juncture. Admittedly, we now expect that the heavier cooling demand will leave more room for restocking in the back half of the season, possibly eliminating the need for additional price-induced demand growth during the upcoming shoulder season.”

Weather forecasts came in slightly warmer overnight. “[Tuesday’s] forecast has trended slightly warmer across the East when compared to Friday, gaining two PWCDDs,” said WSI Corp. in its Tuesday morning six- to 10-day outlook. “Forecast confidence is considered near to slightly above average standards due to reasonably good large-scale model agreement.”

Market technicians see the market needing to trade about a dime higher before any kind of bullish scenario can come into play.

“While the bulls were unable to find their footing Monday, they have another opportunity to do so Tuesday, thanks to the potential doji star bottom on the daily candlestick chart,” said Brian LaRose, a market technician with United ICAP, in closing comments Monday. “But bulls will need more than the usual rally to confirm this bottoming pattern. In this case, we would like to see the $2.934 high exceeded. [We] have no reason to get behind the bulls otherwise.”

Analysts see the temperature factor losing ground to production as the August contract expires. “[Monday’s] modest losses are quickly being negated in the overnight trade with this ‘zig-zag’ type price activity likely to continue through month’s end,” said Jim Ritterbusch of Ritterbusch and Associates in a Tuesday morning note to clients. “At the present time, the temperature factor looks price-supportive beyond this week’s normal trends as most forecasters are seeing hotter and broader based patterns next week than was the case at the start of this week. But some significant moderation is expected across a major portion of the Midcontinent by later next week and well into the first week of August.

“With the rollover to the September contract as prompt month next week, the temperature factor should begin to diminish in importance with more attention likely to be placed on the supply side of the equation. But while some leveling in production with year-over-year gains seeing reduction going forward will be acting as a minor supportive force, it is unlikely to spur much price strength unless accompanied by a major storm event that cuts [Gulf of Mexico] output appreciably.

“Otherwise, we see a market trapped for now in which a position-type trading opportunity in excess of some 20-25 cents will likely remain elusive. But identifying a range-bound market in which sideways price action is a strong probability can also be advantageous in offering opportunities within the options market with an effort toward capturing premium within various straddle-type strategies.”